By Sidhima Choudhary
Union Finance Minister Nirmala Sitharaman presented the Economic Survey on January 31, forecasting India’s GDP growth for FY 2025-26 in the range of 6.3% to 6.8%. However, the economic growth for the current financial year (FY 2024-25) is expected to decline to 6.4%, marking a four-year low.
The survey highlights India’s strong economic fundamentals, supported by steady consumption and strategic fiscal policies. However, global uncertainties, inflation risks, and geopolitical tensions continue to pose challenges.
The Budget 2024-25 provided a multi-sectoral policy plan for the sustained growth push, with the expectation of investment activity to pick up and be supported by higher public capital expenditures, improving business expectations.
In terms of inflation, the report said the risk from higher commodity prices seems limited in FY26, but the concern remains due to the economic and political uncertainties worldwide. Whereas, in FY25, the Food inflation is expected to be softened as seasonal growth of vegetables improves and kharif harvest reaches markets. The reports included the major highlights which incorporate handling the global economic challenges and the need for smarter and stronger economic foundations.
The report also addressed rupee depreciation in 2024 primarily because of the stronger US dollar amid the geopolitical tensions and uncertainty of the US presidential elections. Whereas, Investment is likely to rise driven by increased government spending and better businesses.
The economy is expected to be more service-oriented and liable to automation with an intense possibility of magnification in the impact of AI. The report also discussed the growing concerns of Corporate sector employees where 60 hours of work week was addressed, signifying it poses major health concerns.
Research to increase the production of climate-resilient crops was stressed more. Crops like pulses, tomatoes, and onions were expected to enhance yield and reduce crop damage.
Intending to become a developed nation, India needs to grow 8% on average for about 20 years with investments spiking from 31% to 35%. The correct regulation of reforms and policies should be highly focused on.